ATTACHMENT 1

Cost Saving Measures

Recommendations from the Technology Committee

The following are possible cost saving measures recommended by the Technology Committee for the forthcoming 2005-2006 Chapel Hill Town Budget.  It has not been possible to determine the potential savings for most of these items, because accurate and detailed cost information is not available for the various elements described.

A recommendation for additional expense accounting categories is presented as a worksheet noted as "TC Strategic Plan - Expense Categories,” which accompanied the submission of the Technology Committee Strategic Plan.  The Technology Committee offers to work with Town staff to refine and develop this list as needed, and incorporate these additional categories in the coming fiscal year so that the level of expense detail required to support cost-saving measures such as those recommended below will be available in subsequent years.

$ Recommend the deferral or modification of planned computer hardware replacement and upgrade purchases (per the current 3-year replacement cycle policy) for the coming fiscal year. During this coming budget year, the Technology Committee will work with Town staff to examine current purchasing practices, replacement cycle policies, hardware and software standards, deployment methods, migration strategies and alternatives for hardware and software financing, and make appropriate recommendations. Information provided to the Technology Committee by Town staff indicates estimated savings by this action of $20,000 in the first year and $50,000 per year within three years.

Please note: 1) Critical expenditures which may be identified in emergency services and other areas are not intended to be deferred by this action, and Council and Town staff should continue to see that critical needs in this area are met, and; 2) The Technology Committee expects that a modified replacement policy and its attendant expense/projected savings will be re-introduced in the 2006-07 budget cycle.

$ Recommend the development of a pilot project for the use of open source software to replace existing licensed software operating systems and applications.  This pilot project will determine what savings might accrue from such a move and will identify the costs and intangible factors that must be considered in such a strategy shift.  Part of this pilot project would include the development of cost/benefit, ROI, lifecycle costs, skills assessments and/or feasibility studies as a logical first step to establish a benchmark for evaluating the relative success of the pilot project.

$ Recommend an RFP for consultant review of virus defense, e-mail retention policies, backup and recovery processes and standardized disk images.  The overall effect should be increased user satisfaction and lower IT help calls (IT Director reports at least 70% of all calls are related to these issues.)

$ Provide a line item for technology spending for the new Town Operations Center which will identify actual projected costs which then become subject to review.

$ The TC recommends the review, by the TC, of all IT expenditures in all departments as suggested in the Infrastructure Strategic Plan.  Until this year, technology expenditures could not be tracked in any departmental budgets.  In this year’s budget, a number of new budget codes have been instituted (telephone, network/data communication, computer use, software licenses, web services, computer small equipment.)  The Infrastructure Committee has recommended an even finer granularity for consideration, as previously noted and included in the “TC Strategic Plan - Expense Categories” worksheet.

$ Look into whether the development of a method for town citizens to pay fees and taxes online will increase revenues, decrease costs, improve cash flow or simply provide a convenience to the citizens of Chapel Hill. 

$ Minimize utility expenditures (e.g., evaluate options for Voice over IP to reduce telephone costs, develop and/or enforce energy-saving policies and other such strategies.)

$ Analyze how technical training is done with the goal of streamlining it.  

$ Replace legacy systems (e.g., database systems underlying websites.)

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